Hot Jobs Data Hammers Bitcoin as March Fed Cut Odds Shrink to 8%

Bitcoin’s slide deepened after a firmer U.S. labor readout forced traders to rethink the timing of easier policy. With the March rate cut now priced as a long shot, crypto lost its immediate “cheaper money” tailwind—and the market traded like it knew it.

Bitcoin changed hands near $67,500, down about 2% on the day, with Ethereum at $1,950 (-3%) and Solana at $80 (-3.4%), per CoinGecko. The backdrop remains choppy: last week Bitcoin tagged $62,800—its lowest level in 14 months—before bouncing to $71,500 on Sunday.

The catalyst was straightforward. January payrolls rose by 130,000 versus economists’ 70,000 expectation, and unemployment ticked to 4.3% versus 4.4% expected. After three consecutive cuts to end last year, Chair Jerome Powell reiterated that the Fed would stay data-dependent, keeping the benchmark rate at a 3.50% to 3.75% target range for now. Futures swiftly reflected the message: CME FedWatch showed just an 8% probability of a 25 bp cut in March—down from 20% a day earlier and 27% a month ago.

Here’s the part markets often misread: for Bitcoin, the question isn’t simply if rates are coming down—it’s when enough rate relief aligns with risk appetite. A hot jobs print doesn’t change the destination of policy normalization, but it elongates the path. That timing shift matters because crypto positioning is chronically tethered to calendar-based narratives. When those timelines slip, leverage unwinds, basis compresses, and dip-buying hesitates.

You could see it spill across risk: the S&P 500 and Nasdaq blipped higher on the headline, then faded alongside crypto. Meanwhile, gold advanced 1.3% to around $5,100 per ounce. The rotation says more about psychology than macro fundamentals. Participants grow more valuation-sensitive when the policy impulse is pushed out, particularly around AI-exposed equities where future cash flows carry a higher discount-rate penalty. That caution bleeds into crypto, where earnings don’t exist to anchor multiples and conviction relies on liquidity, network growth, and narrative strength.

Three dynamics to watch: - Time premium vs. rate premium: With March relief repriced lower, investors demand more evidence before recommitting to risk. Bitcoin’s sensitivity to the path of real rates remains intact, but the payoff horizon moved right. - Position structure: Perpetuals often magnify repricing. When timelines slip, funding cools and basis tightens, forcing momentum traders to reduce risk—even if the medium-term thesis is unchanged. - Cross-asset signaling: Bond markets haven’t meaningfully shifted long-term expectations, suggesting a destination of lower rates is still in play. Yet equity investors are becoming pickier around lofty AI-linked valuations, and that selectivity reduces spillover bids into crypto.

Some crypto-native investors will call this a temporary macro squall—and they may be right over a multi-quarter lens. But in the near term, the market is telling you there’s little urgency to add unless policy visibility improves or price does the work. That lines up with what many desks observe: a muted appetite for aggressive dip-buying while attention drifts to AI and gold.

None of this invalidates the typical playbook that lower rates support risk assets. It simply pushes the starting gun back. Until the data reopens the door to earlier easing—or Bitcoin rebuilds momentum on its own fundamentals—expect rallies to be sold and volatility to be path-dependent rather than trend-driven.